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Weekly Report - 2022/11/11: Market Analysis

Market



  • The Consumer Price Index (CPI) rose by 9.2% between October 2021 and October 2022, up from an annual increase of 8.2% in the 12 months to September 2022.

  • This is the thirteenth straight month where the annual increase for the CPI has been at least 5.0%.

  • The divisions with the largest increases in the year to October were Housing, Water, Electricity, Gas & Other Fuels (+27.8%) and Food & Non-Alcoholic Beverages (+10.6%).

  • Education (-6.6%) and Miscellaneous Goods & Services (-0.1%) were the only divisions to show a decrease when compared with October 2021.

  • Core CPI rose by 0.3% in October, which is 0.2 points below expectations, and down from 0.6% last month. It's now running at 6.3% over the year down from 6.6%. This is a very encouraging inflation report. There's a good chance that inflation has peaked, and is now turning down.




It has been a tough week for Macro Market this week. After the drama of Binance and FTX, the obvious conclusion is that the whole industry are facing a huge risk, and the companies related with FTX could be the next bomb and we needs more safety for our assets. Here it is the article described this drama: https://www.coindesk.com/business/2022/11/09/binance-is-strongly-leaning-toward-scrapping-ftx-rescue-takeover-after-first-glance-at-books-source/


During this situation, it is impossible to predict what is going to happen in the next days or hours. BTC/ETH/Altcoins price are tightly bonded with CZ and SBF’s decision. Keeping stablecoins might be the appropriate decision if you are not a professional trader.





Stablecoin - 2022/11/2 ~2022/11/2

1. USDT/USDC/BUSD Supply







Money still keeps out-flowing from Crypto Market, this is not a good signal. In our opinion, USDC is more ‘safety’ and admitted by traditional capital. The situation of USDC supply could represent whether the incremental capital inflows into Crypto Market.

Nearly 1.4 billion flew into Crypto Market last week, which means the increase of liquidity and could be a good start for market.


2. Stablecoins Exchange Netflow Volume





BUSD has become the main buying power of 11/10 pump. It is not surprised that Binance has become the most trusted CEX after FTX collapse.

The Stablecoins cash flow has become positve since 11/10, but it cannot guaranteed that the market will still go upside in the next week.


BTC/ETH

1. BTC/ETH CEX Balance




BTC/ETH CEX reserves dropped a lot these days, which means people are losing their trust in CEX, but it also implies that the selling pressure are decreasing.


2. Miner Reserve





The miner reserve has been kept stable since Sep 2022, 5,000 BTC was sold on 11/08 due to FTX collapse.


3. ETH PoS State





The inactive onchain activity kept base gas price above 15.6 gwei most of time, therefore the Ethereum kept in deflation state at -0.35%/year, estimated decreasing 430,000 ETH per year.

On-Chain Activity

MakerDAO Liquidation Status




If the current price goes down 32%, there will be large liquidations happening. With the liquidation, people are going to payback their debt and withdraw the liquidity. The worst thing is bumping down effect, BTC/ETH are liquidated continually with a 90% price and around 900MM selling pressure are waiting for us. We will never know the bottom at that time.


DeFi




Bridge






NFT



Insights(not for investment suggestion)

Wilson

Fundamentals starts to become positive, but the market is dominated by the CEX’s drama and what is going to happen in the next days. Be cautious about the market and wait for the settlement of this incident.


Barron

1. Trading strategy has been changed since core CPI reached the normal level, there is no need to worry about interest raising. ETH will perform way better than Market Beta whether the market is good or not. Bull on ETH.

2. This is not the real bottom(but close to that), still need to waiting for the bottom.


Traders

Market judgment: still maintain the previous judgment short-term by the US dollar index falling, the midterm election results and yesterday night's CPI data good short-term external environment and other factors.the probability of rapid new low in the short term is low. It is more inclined to probe the support near 15,000(BTC) after the failure of proper reverse supply pressure level, and finally explore the bottom space category.

Position suggestion: Although the current price of the tokens quickly fell, but due to the external market has turned better. Therefore, it is recommended to carry out high casting and low suction operation, and the overall buying-dip orders are still mainly (30%-50% above and below the current position to find close support or pressure for the order).


Czhang

1. Altcoins: catching the falling knifes, 40%~50% below current price

2. BTC/ETH: waiting for the price pumps to 18000/1400, then short.





Recommended Readings

The Case for $15,000 ETH

https://newsletter.banklesshq.com/p/the-case-for-15000-eth


Why eigenlayer is a big deal

https://twitter.com/MeirBank/status/1589013673385000960


Scaling, modularity and the question of blockchain longevity


Gearbox Protocol: Shifting DeFi Into the Next GEAR

https://members.delphidigital.io/reports/gearbox-protocol-shifting-defi-into-the-next-gear


Defi on Bitcoin

https://www.insightdefi.com/post/research-paper-defi-on-bitcoin


NFT Lending w Goblin Sax

https://twitter.com/tangent_xyz/status/1588916353586855936

Gaming

Axie Origins Economy Deep Dive

https://twitter.com/VaderResearch/status/1588471350758236160

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